Using social media

Citation

(2010), "Using social media", Journal of Consumer Marketing, Vol. 27 No. 5. https://doi.org/10.1108/jcm.2010.07727eab.001

Using social media

Article Type: Marketing developments From: Journal of Consumer Marketing, Volume 27, Issue 5

Edited by Dennis A. Pitta, University of Baltimore

The world is aTwitter with Google’s launch of Buzz, the newest social media vehicle intended to entice both consumers and marketers (reviewed by Dennis Pitta in this issue). Social media include rating and review sites, video and content sharing sites, blogs, specialty groups, and organized social networks such as Facebook, MySpace, Twitter, YouTube, and Linkedin. Personal invitations serve as the means to enter a social network and join the conversation. As the sites grow, so does their potential for marketing activity. Social networking is word-of-mouth marketing via the internet. Recent research suggests that word-of-mouth referrals have “substantially longer carryover effects than traditional marketing actions and produce substantially higher response elasticities” (Trusov et al., 2009). Time spent watching television is unchanged while time spent social networking has grown 93 percent since 2006. Despite this, marketers still consider social media experimental and budgeted less than $100,000 for them as part of their IMC mix for 2010 (Ray, 2009).

However, this situation is rapidly changing as promotional budgets have shrunk due to the economic downturn. Companies hope that social media are a means of reaching target audiences efficiently and effectively and at a lower cost when compared to traditional media. This column will present the pros and cons of social media as well as recommendations to help marketers decide when and how to use social media successfully.

On the pro side, Bernoff and Li (2009) suggest that social media are useful for listening, talking, energizing and supporting consumers. CBS saved the show Jericho and retained ratings for the network by listening to the online blog chatter from fans. By talking to its target audience via Facebook and MySpace, Chevrolet was able to increase sales for their new Aveo model. Fiskars engaged an online community of scrapbookers by cultivating a network of “lead ambassadors” called Fiskateers. Dell used negative reports about their customer service from a blogger to create a “blog resolution team” to identify disgruntled customers and then developed its own blog, “Direct2Dell”, to support consumers. Pepsi decided not to advertise at the Super Bowl this year – instead they founded the “Pepsi Refresh Project” to donate money for charitable causes/projects and accept electronic applications. Through Facebook, Twitter and the web site www.refreshyourself.com, customers vote for the projects they wish to support and Pepsi donates $1.3 million per month in different funding categories. Two awards are made per category, from $5,000 to $250,000. They encourage Facebook and Twitter users to refer their friends to the web site.

Now for the cons: Harrison (2009) asserts that social media are merely “the emperor in his latest new clothes”. His thesis is that any media platform survives based on the ability to deliver audience and generate revenue, and points out that since Google has over 50 percent of total online revenue that all other social media have to fight it out for the rest of the remaining revenue (it should be noted here that the introduction of Buzz will change the dynamics of the social network competitive landscape and may increase Google’s share of the pie even further). Further, he cites an oversupply of “online inventory chasing a smaller advertising cake”. Many social network users expect free content and to complicate matters, no ads interrupting their messaging.

Other key barriers to social media use by marketers are the loss of control over the message and the lack of metrics to measure the effect on brand awareness and usage. These issues combined with economic uncertainty create complex choices for marketers.

So what is a marketer to do? The following recommendations are presented:

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  New social media vehicles should account for approximately 10-15 percent of IMC spending and should focus on the potential reach and cost of the specific online vehicle. Trusov et al. (2009) found that each online outbound word-of-mouth referral is worth approximately $0.75 per year in increased advertising revenue; this will be critical given the current economic climate. The availability of reliable metrics for measuring vehicle performance will be very important and can be easily identified through surveys, focus groups, and workshops (Court, 2009). Further, new companies are emerging such as Spredfast that provide social media metrics (Business Wire, 2010).

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  Demographics matter. Bertlesen (2010) from MediaPost.com outlines the use of social media by demographic group in Table I.

  Millennials currently have the highest usage of social media, but there is significant usage growth in other groups, particularly among Boomers and Matures. Marketers must choose the particular social network that best reaches their demographic as each group has important differences. Millennials and Generation X are the easiest to reach via social networking sites. Teens are eager to pass along messages. For example, Okazaki (2009) found that teenagers from 13-18 years old are willing to use their mobile phones to make referrals for specific brands. In fact, brand commitment reinforced their motives to participate in referral programs. Boomers’ growth in the use of social media will depend on reaching them at networks in which they are already members, and having what Bertelsen calls “share worthy content”. Matures want to connect to others such as family and friends and comparison shop for low prices. The use of opinion leaders can assist in increasing brand awareness by designing entertaining or informative messages that are to be shared by those of the same age group.

  There are also demographic differences with respect to the specific social networking sites that are frequented by each group. Ray (2009) reports that the median age for Twitter is 31, compared to 26 for Facebook and 40 for Linkedin. Facebook has the 35-54 year old demographic and members skew higher in education, while two-thirds of MySpace membership is 18 to 25 and skews lower in education. Both sites are more likely to be frequented by females (Merkle, 2010).

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  Prepare the organization for change. Bernoff and Li (2009) recommend that firms ensure buy-in with marketing managers and top management. Focus on small but manageable projects so that success with these leads to larger projects. The focus should not be on the technology but how the social media will contribute to the brand and company culture. Availability of reliable metrics and identification of the appropriate demographics will further assist with the buy-in process.

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  Focus on customer utility. Ultimately, a social networking site must have something of value for customers. Platitudes about one’s brand and planted positive company messages are not only ineffective on social networks but actually anger participants. If a company wants to enter the social networking arena, they must reexamine how their brand satisfies its customers and how they can translate this satisfaction into generating dialogue and perceived usefulness.

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  Embrace negative chatter. Not everyone will have positive experiences with a specific brand. The key to successful social networking is to acknowledge bad experiences and resolve them with positive action. This creates goodwill and generates positive buzz on the network. Accept the loss of complete control and use it to your advantage to create brand loyalty experiences.

Social media are useful electronic word-of-mouth promotional tools that can help marketing managers develop successful promotional strategies when used together with traditional media. The key is to understand how they works and who uses them so they are targeted to the right audience.